Seniors have been told by Finance Minister Bob Richards that they won’t be getting an increase in their state pension because “money does not grow on trees”.

Age Concern said yesterday that the news, delivered by the Minister during a question-and-answer session at the charity’s annual general meeting, was a “blow”.

“The Minister was asked ‘do you see an increase in pensions any time soon?’, given that the economy is still struggling and expenses are rising,” Age Concern executive director Claudette Fleming told The Royal Gazette.

“The Minister basically said ‘not any time soon’. That was a blow. People are struggling. It has been a few years now since an increase.”

The charity’s minutes of the meeting quote Mr Richards as saying to the 100 or so members who gathered at St Paul’s Church in Paget: “Money does not grow on trees. Every dollar that you have in your pocket, it all comes from the same place; that is, outside of Bermuda.

“The social insurance fund is underfunded and so is the Civil Service pension fund. All the money comes from people abroad. If I increase pensions, I will inflict pain and discomfort for people who come after us.

“All the money comes from the same place. Bermuda’s economy is like a family budget. We have to be cautious with our planning.”

Pensioners last got an increase in their contributory pension in August 2011 — a three percent rise described by the then Opposition One Bermuda Alliance as “woefully inadequate”.

In the meantime, the cost of living in Bermuda has risen by 6.3 percent, according to the Consumer Price Index (CPI) published by the Department of Statistics.

Since coming to power in December 2012, the OBA has not increased the state pension, which is paid out of the Contributory Pension Fund.

It was reported last year that the fund was underfunded by $2.06 billion and its resources would be exhausted by 2047 if current actuarial assumptions remain unchanged.

Ms Fleming said Mr Richards told Age Concern members that the fund was in better shape than the Superannuation Fund, which funds government employee pensions.

She said the Minister spoke of the “shared sacrifice” that everyone in Bermuda needed to make to improve the Island’s economy and help pay off the Island’s “huge debt”.

“We understand that it’s a shared sacrifice but you have got to remember that this is a generation that’s made a sacrifice while it’s working,” said Ms Fleming.

Shadow Seniors Minister Derrick Burgess said last night that seniors were crying out for a rise in their state pensions as “most of their pension cheque is for medication”.

The Progressive Labour Party politician said: “What happens in a lot of households is that seniors have to decide if they are going to spend on medicine or food and you can’t take medicine on an empty stomach.

“The policy was that pensions would be increased every two years based on the CPI. I think the Government has certainly got this wrong.”

He cited the freezing this year of cost-of-living increases for government employee pensions as another bad decision and questioned why Government wasn’t asking others to make sacrifices.

“No one has asked the doctors to, say, ‘cut your fees by ten percent’,” said Mr Burgess.

Ms Fleming said the rising cost of healthcare for seniors was a key topic during the question-and-answer session but there was no indication that things were likely to improve.

Mr Richards and Health and Seniors Minister Jeanne Atherden, who also attended the AGM as a panellist, were asked if monthly payments for the FutureCare health insurance plan were likely to come down or if additional benefits would be included in the scheme.

The charity minutes record Ms Ath- erden as saying: “We recognise that the money we have has to get the biggest bang for our buck. We are looking at prescription drugs being included. Generic drugs are not as expensive and that helps. We have to require less healthcare; many illnesses are driven by lifestyles.

“We have to live healthier lives. Many of the present health risks are related to poor lifestyles. We have to make people go to their doctor, rather than rushing to the hospital for an emergency. Utilisation, diagnostic testing have gone way up; living healthily will bring costs down.”

Age Concern says it invited all of the Island’s parliamentarians to its AGM on September 10 and was disappointed that none chose to attend, apart from the two Cabinet Ministers.

Mr Burgess said: “I sincerely knew nothing about it. If I had gotten an invitation, you can bet your life I’d have been there.”

When asked to elaborate on the AGM remarks, a Ministry of Finance spokesman last night said: “At the AGM, the Minister of Finance clearly explained the challenges facing Bermuda’s social pension scheme which is currently underfunded by over $2 billion.

“Another problem facing the plan is that the number of persons that contribute to the fund, the working population, is reducing while the number of pensioners ie seniors, is increasing. This has had a negative impact on the plan with the fund paying out more money than what it takes in. Under these conditions it would be imprudent to increase benefits under the plan at this time.

“The Government is currently working on rectifying the structural deficiencies of the plan and when these changes are introduced to the plan it may be possible to restore some degree of indexation to all pensioners in the future, depending on how the funded position of the plan and its long term financial viability improves.”

Ms Atherden added: “I suspect that seniors will be disappointed at not receiving a pension increase, but I also believe that Bermuda’s seniors understand the importance of being careful with the national purse. They have grown up budgeting carefully for their households, and they expect the Government to do the same with the money in the pension fund.”